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IMF : the growth potential for Romania’s economy is 2% between 2013 - 2017
IMF estimates a growth potential of 2% for Romania’s economy between 2013 – 2017 against one of 5.3% between 2003 – 2007 and one of 1.6% between 2008 and 2012.According to a study published on Thursday by IMF the economies in Eastern Europe will be able to record a growth rhythm half of the rhythm recorded before the financial crisis of 2008, Reuters says.
In 2013 – 2017 the annual growth potential of the economies in Eastern Europe will be of 2.3% as compared to 5.2% recorded in 2003-2007 and 1.7% between 2008-2012.In a semiannual report the Fund warns the countries which confront the biggest decline of growth potential are Ukraine, Latvia, Russia, Slovakia, Bulgaria and Romania.For example the growth potential of Ukraine for 2013 -2017 is 1.4% against 6.6% in the five years before the crisis.
The Fund considers that this drop in growth potential is due to the fact that western banks which in the boom period inundated the Eastern Europe with capital start to withdraw towards the parent markets.
‘It is possible that the GDP advance be limited, constrained by the reduced offer of credit, small capital flows, the modest growth recorded by commercial partners and demographic pressures’ IMF says.
The Fund recommends a series of measures for the improvement of the growth potential such as the solution of nonperforming credits in the banking sector, the improvement of production of goods for export, the improvement of the investment environment such as the simplification of the legislation and the restructuring of state companies.
According to the most recent edition of the report World Economic Outlook, IMF estimates that this year Romania will record an economic growth of 2% followed by an advance of 2.2 in 2014.
Ponta: IMF visit begins on Tuesday, we shall prepare budget revision and budget for 2014
Prime Minister Victor Ponta asked ministers to prepare the data for the budget revision and for drawing up the budget for next year, in the context in which on Tuesday begins the first evaluation of the new agreement Romania signed with the International Monetary Fund (IMF) and with the European Commission (EC).
'Mr Vice Premier Chitoiu and Mr Voinea [Liviu Voinea, Secretary of State with the Finance Ministry] and the other ministers have as task the coordination of our preparation for a first meeting with the representatives of the international financial institutions, the visit begins on Tuesday, so that we should prepare both the budget revision and especially the budget for 2014, which will be grounded on the political decisions we shall make today in the USL [Social Liberal Union, alliance, at rule], then discuss with the parliamentary groups of the Opposition and implement in terms of decentralisation starting January 1, 2014,' Ponta said in the beginning of the Government meeting on Friday.
On Tuesday begins the first IMF and EC mission for the evaluation of the new agreement Romania signed with the international institutions.